Industry observers say CEO’s exit leaves Opel’s future hanging

Article by Anita Panait, on July 17, 2012

With the eventual exit of Karl-Friedrich Stracke as chief executive of the financially beleaguered Opel, observers in the auto industry are now left wondering whether that would mean and lead to the eminent departure of the European unit of U.S.-based automaker General Motors.

The movements and the action in the past four weeks had been tell-tale signs that Opel might be able to make through in the near future and eventually put an end to its losing streak, as the GM unit has been swimming in $3.5 billion in losses due to weakening European car market and inflated fixed cost base.

Opel’s management and labour unions had approved a mid-term business plan and had agreed to terminate operations at a German factory in 2017 as the basis for restructuring negotiations, according to Autonews.

Due to these good signs, even analysts at Morgan Stanley analysts drew their focus away from Opel’s problems to Ford’s European issues. Despite words from company sources that Stracke’s removal changes a little of the sistuation, Opel’s future has become more unclear than ever. Although GM and Opel said that the reason for Stracke’s removal was for him to take on special assignments at the US carmaker, many believe that it was not the real one.

An industry observer quipped that GM chief executive Dan Akerson was heeding the advice of ex-GE boss and management guru Jack Welch, who had remarked if a company didn't measure up, the only options were to "fix it, sell it, or close it'." Out of the three options, Akerson is now trying to fix Opel. He had tried to sell the loss-making unit, but had failed to do so.

If the fix option does not work, Akerson could as well be bound to shut down Opel, according to Ferdinand Dudenhoeffer, a professor at the Centre Automotive Research (CAR) in Duisburg, Germany. Armin Schild, a regional chief of the IG Metall union that negotiates for Opel's blue-collar workers, and a supervisory board member at the carmaker, has warned that more is at stake in future negotiations than just swapping job guarantees for wage concessions.

Topics: opel

If you liked the article, share on:

Pin It

Comments

Recommended

To the proud owners and owner-to-be of the Porsche 991 Carrera GTS, there's good news for you all. German automobile manufacturer Porsche recently confirmed to the public that the Porsche...
by - March 23, 2017
McLaren diehards, this is the moment that you're all waiting for. The British automaker recently publicized the teaser outline of its new automobile that will hit the streets soon, dubbed...
by - March 23, 2017
PSA seems very confident about conquering the world. The purchase of Opel/Vauxhall for €2.2 billion ($2.3B) from General Motors makes PSA the second largest car company, just behind the Volkswagen...
by - March 23, 2017
Reporting for duty. It’s been a year since the Victoria Police was loaned a new Mercedes-AMG GLE 63 S Coupe. In those 12 months, the coupe served as the law...
by - March 23, 2017
After making its debut at the Paris Motor Show last year as a concept car, the Trezor by Renault managed to bring home the 2016 Concept Car Design Of The...
by - March 23, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries